Ohio House Bill No. 28 proposes to amend several sections of the Ohio Revised Code related to property tax levies and other financial and administrative aspects of local government, schools, and districts. A central theme is the elimination of the authority to levy replacement property tax levies. The bill also addresses tax reduction calculations, partial exemptions, township mergers, school district fiscal management, and procedures for levying taxes for various purposes, such as parks, community colleges, and mental health services.
Key Themes and Ideas:
- Elimination of Replacement Property Tax Levies: The core purpose of the bill is to repeal section 5705.192 of the Revised Code, thereby “eliminate the authority to levy replacement property tax levies.” This change would significantly impact how local governments and school districts can fund their operations, potentially limiting their ability to maintain existing revenue streams.
- Property Tax Reduction and Calculation: The bill details how the tax commissioner and county auditors determine tax reduction percentages for real property. “The auditor, after complying with section 319.30 of the Revised Code, shall reduce the sum to be levied by such tax against each parcel of real property in the district by the percentage so certified for its class.” These calculations involve determining effective tax rates and ensuring a minimum level of taxation (2% of taxable value for school districts in some cases).
- Partial Exemption for Manufactured Homes: The bill provides a partial exemption of ten percent for manufactured homes on the tax list, applicable to “qualifying levies.” This exemption does not extend to replacement levies imposed under the previous version of section 5705.192.
- Township Mergers and Special Purpose Districts: The bill outlines procedures for merging townships, including provisions for zoning codes and the handling of special purpose districts. “Zoning codes that existed at the time of the merger shall remain in effect after the merger, and the townships that existed before the merger shall be treated as administrative districts within the new township for the purposes of zoning.”
- School District Fiscal Management: Several sections address the financial challenges faced by school districts in fiscal watch or emergency. The bill allows for restructuring or refinancing loans, subject to the approval of the director of education and workforce. New operating revenue, generated by specific levies, is needed to enable restructuring. The bill also touches on shared services agreements as a means of improving efficiency.
- Levying Taxes for Various Purposes: The bill details procedures for park districts, state community colleges, and county alcohol, drug addiction, and mental health service districts to levy taxes. This includes outlining the required resolutions, ballot language, and voter approval processes. The ballot language is very specific. For example, concerning school district bonds, the ballot should read, “Shall the __________ school district be authorized to do the following: (1) Issue bonds for the purpose of __________ in the principal amount of $______, to be repaid annually over a maximum period of ______ years, and levy a property tax outside the ten-mill limitation…”.
- Ballot Language Requirements: The bill includes very specific requirements for ballot language related to property tax levies, prohibiting the use of boldface type or different font sizes.
Key Quotes:
- “To amend sections 319.301, 319.302, 523.06, 1545.21, 3316.041, 3316.06, 3358.11, 3505.06, 5705.03, 5705.218, 5705.2111, 5705.221, 5705.233, 5705.261, and 5705.412 and to repeal section 5705.192 of the Revised Code to eliminate the authority to levy replacement property tax levies.” (Statement of the bill’s primary purpose)
- “”Qualifying levy” does not include any replacement imposed under section 5705.192 of the Revised Code, as it existed before the effective date of this amendment, of any levy described in division (B)(1) of this section.” (Exclusion of replacement levies from qualifying for partial exemptions)
- “A percentage or a tax reduction factor determined or computed by the commissioner under this section shall be used solely for the purpose of reducing the sums to be levied by the tax to which it applies for the year for which it was determined or computed. It shall not be used in making any tax computations for any ensuing tax year.” (Clarification about tax reduction calculations)
Potential Impacts:
- Local Government Funding: Eliminating replacement levies could strain the budgets of local governments and school districts that rely on this mechanism to maintain funding levels.
- Taxpayer Burden: The changes in tax calculations and exemptions could affect individual taxpayers differently, depending on their property type and location.
- School District Finances: The provisions related to school district fiscal management could help districts facing financial difficulties, but voter approval of new levies is often a prerequisite.
- Election Procedures: The detailed requirements for ballot language aim to ensure clarity and transparency for voters.
This briefing document provides a comprehensive overview of Ohio House Bill No. 28, highlighting its key themes, provisions, and potential impacts. Further analysis would be needed to fully assess the implications of these proposed changes.